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Manny Calavera is really that skeleton in Blondebeard's chicken restaurant in The Curse of Monkey Island
It is apparently not just a Shout-Out that they share the same face. Manny was one of the undead pirates working for LeChuck and he got Killed Off for Real when Blondebeard stabbed him for criticizing his dishes. It is implied that souls who have to become Grim Reapers have had themselves some pretty sinful lives, and Manny must have been quite an evil pirate.
  • Well, it's certainly in the same game universe, and they do have connections here and there. My theory is that Manny died by being run over or getting in a really nasty road accident. Perhaps he was a drag racer?
    • That’d be pretty ironic in hindsight, considering Glottis’s addiction to speed.

Manny never did anything bad enough to get "community service" as a Reaper
He says he doesn't know what he did to become a Reaper, and he doesn't seem at all evil. The DoD corruption extends to the recruitment of Reapers too; note all Reapers get a Number Nine ticket (the reward for the most virtuous souls like Meche or the nun Domino reaped in Year 1) when they leave? They were owed it anyway, the company just withheld it in order to get Reapers to work for them.
  • In support of this, Salvadore was a former Reaper, and we later find out that he qualified for a Number Nine ticket all along.
  • Nick Virago didn't work for the DoD but got sent to hell for his crimes while Manny got his NN ticket as a severance bonus. Your start may be defined by your sins in life, but your ultimate fate is defined by your actions in the Land of the Dead.
  • And not for nothing Manny is an ideal recruit. He has a tendency to turn any business he touches into a success in short order and to rise through the ranks with ease. The only draw back is that Manny is too much of a good person to stay where he is if he senses that something's off.
Hector was a high ranking member or boss of a mob/cartel in life
  • We’ve seen that Hector is a nasty piece of work, willing to scam, steal, threaten and re-kill just to amass enough Number Nine tickets to outweigh the bad deeds he committed in life. But we never get to know what those bad deeds were, aside from a vague statement by the man himself that he was a “very naughty boy”. He could’ve just been your garden variety Serial Killer or career criminal, but then how would he know how to sink his claws so easily into high-ranking and influential institutions like the Department of Death? Clearly, he was doing similar things in life as he is in death, for the same blanket reason (benefiting himself and escaping consequence), and after his luck ran out in life he became paranoid about his fate in death, starting his conspiracy as a result.
The Land of the Dead is actually Purgatory
It's the place before the 9th level where souls are either purified by their experiences or get the quick ride through because they don't have as much to work off. And while it seems like some prefer to just stick around for their own reasons, if they just took the journey, they would've been accepted at the end. Hence why "cheaters", trying to sidestep the hard work, get a one way ticket to Hell.

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